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Strategy

US Investment Grade Core Bond

The US Investment Grade Core Bond Composite seeks current income and capital appreciation primarily through investment in sectors and investment grade securities in U.S. Fixed Income Indices, including the Barclays U.S. Aggregate Index. The strategy does not typically deviate significantly from the benchmark, but has flexibility to do so when market conditions warrant.

3YR Return Annualised (Net)
(View Total Returns)

Tracking Error
(5 Years)

3.12%
0.40%

1YR Return (Net)
(View Total Returns)

Information Ratio
(5 Years)

10.48%
1.02

Inception Date 30-Jun-1979

Performance figures calculated in USD

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Brian Brennan
Brian Brennan, Portfolio Manager

Brian Brennan is a portfolio manager in the Fixed Income Division at T. Rowe Price. Mr. Brennan has lead portfolio management responsibilities for the US Treasury, US Core Plus Bond, and Stable Value Strategies. He also is a member of the portfolio strategy team for T. Rowe Price's core and core plus mandates. Mr. Brennan is a vice president of T. Rowe Price Group, Inc., T. Rowe Price Associates, Inc., T. Rowe Price International Ltd, and T. Rowe Price Trust Company.

 

Strategy

Investment Approach

  • Focuses primarily on investment-grade, U.S. fixed income securities, with the ability to integrate non-index sectors and securities.
  • Integrates proprietary credit and capital market research to identify market inefficiencies and relative value opportunities.
  • Adds value primarily through sector allocation and individual security selection. Can also adjust duration and term structure positioning to enhance return potential and defend against rising rates.
  • Employs a risk-aware approach, with risk exposures based on conviction levels and available opportunities.
  • Exploits market inefficiencies through opportunistic trading conducted by specialist teams.
  • Seeks to exceed the benchmark return by 50 basis points over a market cycle. (Not a formal objective and it can be changed without prior notice.)

Portfolio Construction

  • Duration is managed within +/- 20% of benchmark
  • Sector exposure will typically range +/- 25% relative to the benchmark
  • Average credit quality of the portfolio is AA- or better
  • Expected tracking error should range between 0.5% and 1.0% in most market environments

Holdings

Issuers

Top
Issuers
10
Top 10 Issuers 80.33% Was (30-Jun-2019) 75.86%
Other View Top 10 Issuers

Monthly data as of 30-Sep-2019

Holdings

Total
Holdings
188
Largest Holding TRP Invest Grade Multi-Sector Acct Port 29.86% Was (30-Jun-2019) 25.53%
Top 10 Holdings 67.31%
Other View Full Holdings Quarterly data as of 30-Sep-2019

Quality Rating View quality analysis

  Largest Overweight Largest Underweight
Quality Rating AAA US Treasury
By % 8.16% -21.79%
Portfolio 12.92% 18.22%
Benchmark 4.76% 40.01%

Average Credit Quality

AA

Monthly Data as of 30-Sep-2019
Benchmark:  Bloomberg Barclays U.S. Aggregate Bond Index

Sources: Credit Quality Ratings are obtained using Bloomberg Barclays methodology using ratings derived from Moody’s Investors Service (Moody’s), Standard & Poor’s (S&P), and Fitch Ratings (Fitch). When ratings from all 3 agencies are available, the median rating is used. When ratings are available from 2 of the agencies, the lower rating is used. When 1 rating is available, that rating is used. T. Rowe Price does not evaluate these ratings but simply assigns them to the appropriate credit quality category as determined by the rating agency. T. Rowe Price uses the rating of the underlying investment vehicle for credit default swaps.

U.S. government agency securities are issued or guaranteed by a U.S. government agency and may include conventional pass-through securities and collateralized mortgage obligations. Unlike Treasuries, government agency securities are not issued directly by the U.S. government and are generally unrated but may have credit support from the U.S. Treasury (e.g., FHLMC and FNMA issues) or a direct government guarantee (e.g., GNMA issues). Therefore, this category may include rated and unrated securities. 

U.S. Treasury securities are issued by the U.S. Treasury and are backed by the full faith and credit of the U.S. government. The ratings of U.S. Treasury securities are derived from the ratings on the U.S. government. 

Sectors

Total
Sectors
8
Largest Sector Mortgage 33.67% Was (30-Jun-2019) 31.88%
Other View complete Sector Diversification

Monthly Data as of 30-Sep-2019

Benchmark: Bloomberg Barclays U.S. Aggregate Bond Index

Largest Overweight

ABS
By7.29%
Portfolio 7.73%
Benchmark 0.44%

Largest Underweight

U.S. Treasury
By-22.11%
Portfolio 18.22%
Benchmark 40.33%

Monthly Data as of 30-Sep-2019

Team (As of 31-Aug-2019)

Brian Brennan

Brian Brennan is a portfolio manager in the Fixed Income Division at T. Rowe Price. Mr. Brennan has lead portfolio management responsibilities for the US Treasury, US Core Plus Bond, and Stable Value Strategies. He also is a member of the portfolio strategy team for T. Rowe Price's core and core plus mandates. Mr. Brennan is a vice president of T. Rowe Price Group, Inc., T. Rowe Price Associates, Inc., T. Rowe Price International Ltd, and T. Rowe Price Trust Company.

Mr. Brennan has 33 years of investment experience, 19 of which have been at T. Rowe Price. Prior to joining T. Rowe Price in 2000, he was a fixed income manager with Howard Hughes Medical Institute, responsible for Treasury, emerging, nondollar, and derivative strategies for core plus. Mr. Brennan began his career at CIGNA Investments, Inc., as a portfolio analyst for immunized and indexed fixed income accounts.

Mr. Brennan earned a B.S. in economics and computer sciences and an M.A. in economics from Trinity College in Hartford, Connecticut. He also earned the Chartered Financial Analyst (CFA) designation and is a former president and treasurer of the Baltimore CFA Society.

  • Portfolio manager
    since
    2004
  • Years at
    T. Rowe Price
    19
  • Years investment
    experience
    33
Andrew McCormick

Andy McCormick is the head of the Fixed Income Division for T. Rowe Price, overseeing fixed income investment management. He is the chairman of the Fixed Income Steering Committee, a member of the firm's Management Committee, and head of U.S. Taxable Bonds.

Mr. McCormick has 36 years of investment experience, 11 of which have been with T. Rowe Price. Before his appointment as head of Fixed Income, Mr. McCormick was lead portfolio manager for the U.S. GNMA Bond Strategy and co-portfolio manager for the Total Return Strategy. He also served as head of Securitized Products. Prior to joining the firm in 2008, he spent 13 years on Wall Street trading mortgages and agency securities, 10 years at Fannie Mae managing significant mortgage assets, and two years working with a hedge fund manager and mortgage real estate investment trust firm.

Mr. McCormick earned a B.S. in finance from Syracuse University.

  • Portfolio manager
    since
    2010
  • Years at
    T. Rowe Price
    11
  • Years investment
    experience
    36
Robert M.  Larkins, CFA

Robert Larkins is a portfolio manager in the Fixed Income Division at T. Rowe Price. Mr. Larkins is lead portfolio manager of the firm's suite of bond index strategies, overseeing the U.S. Aggregate Bond Index Strategy, the U.S. Enhanced Aggregate Bond Strategy, and numerous custom bond index mandates, including liability-driven investment portfolios tailored to meet specific client needs. He is also lead portfolio manager of the Long Duration Credit Strategy and is a member of the firm's Investments Derivatives Committee. Mr. Larkins is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.

Mr. Larkins has 16 years of investment experience, all of which have been with T. Rowe Price. Prior to joining the firm in 2003, he worked for Dow Chemical Company for four years as a research engineer.

Mr. Larkins earned a B.S. in chemical engineering from Brigham Young University and an M.B.A. in finance from The Wharton School, University of Pennsylvania. He also has earned the Chartered Financial Analyst designation.

  • Portfolio manager
    since
    2014
  • Years at
    T. Rowe Price
    16
  • Years investment
    experience
    16
Stephen L. Bartolini, CFA

Steve Bartolini is a portfolio manager in the Fixed Income Division at T. Rowe Price. Mr. Bartolini is the lead portfolio manager of the U.S. Core Bond Strategy, the U.S. Inflation Protected Strategy, and the U.S. Short-Term Inflation Focused Bond Strategy. He also co-heads the firm's global interest rate and currency strategy team and is a member of the portfolio strategy team for U.S. taxable bond strategies. Mr. Bartolini is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.

Mr. Bartolini has 20 years of investment experience, nine of which have been with T. Rowe Price. Prior to his current role, he was a Baltimore-based mortgage trader in Global Trading for three years. Before joining T. Rowe Price in 2010, Mr. Bartolini spent nine years at Fannie Mae in the capital markets area, where he served as a director of portfolio management, a senior trader, and an analyst.

Mr. Bartolini earned a B.S. in economics from George Washington University and an M.B.A. in finance from the University of Maryland, Robert H. Smith School of Business. He also has earned the Chartered Financial Analyst designation.

  • Portfolio manager
    since
    2016
  • Years at
    T. Rowe Price
    9
  • Years investment
    experience
    20
Christopher Brown, Jr., CFA

Chris Brown is a portfolio manager in the Fixed Income Division at T. Rowe Price. Mr. Brown is the head of the Securitized Products team, portfolio manager of the Total Return Strategy, and a member of the portfolio strategy team for U.S. taxable bond strategies. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.

Mr. Brown has 19 years of investment experience, 14 of which have been with T. Rowe Price. Before assuming his current role, Mr. Brown was an associate portfolio manager on the U.S. Taxable Bond team and a portfolio investment strategist on the Fixed Income Quantitative team. Prior to joining T. Rowe Price in 2005, he was a fixed income analyst and trader at Riggs Investment Advisors, Inc., in Washington, D.C. Before this, he was an investment analyst for Cambridge Associates LLC in Arlington, Virginia.

Mr. Brown earned a B.A. in economics from Washington & Lee University and an M.B.A. from the University of Maryland, Robert H. Smith School of Business. He also has earned the Chartered Financial Analyst designation.

  • Portfolio manager
    since
    2016
  • Years at
    T. Rowe Price
    14
  • Years investment
    experience
    19
Jeffrey S.  DeVack

Jeff DeVack is a portfolio specialist in the Fixed Income Division of T. Rowe Price. He is a member of the U.S. Core, U.S. Core Plus, U.S. Investment-Grade Core, Enhanced Index, U.S. Treasury, Inflation Protected, and Securitized Products teams, working closely with clients, consultants, and prospects. Mr. DeVack is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.

Mr. DeVack has 19 years of investment experience, eight of which have been at T. Rowe Price. Prior to joining the firm in 2011, he was a partner in an investment consulting group at UBS Financial Services, where he worked with both institutional clientele and high-net-worth families. Mr. DeVack started his career at J.P. Morgan Chase & Co., working primarily as an investment banking analyst in a group that structured asset-backed securities transactions for Fortune 500 companies.

Mr. DeVack earned a B.B.A., magna cum laude, in finance and economics from Loyola University Maryland, Sellinger School of Business and is a member of Beta Gamma Sigma. He also has earned the Chartered Financial Analyst designation.

  • Years at
    T. Rowe Price
    8
  • Years investment
    experience
    19
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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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